Leapfrog, a private equity firm focused on Africa and Asia, has acquired majority stake in Kenyan firm Goodlife Pharmacy. The deal is to date the most important ever sealed in the East African drug sales sector.

The company will pay Catalyst Principal Parters $22 million for the stake. The latter seals here its first capital exit from its Catalyst Fund I East African focused private equity fund for which closing was $125 million.

In September 2014, Catalyst, partnering with a Mauritius-incorporated pharmaceutical firm, acquired a majority stake in Mimosa Pharmacy for an undisclosed amount. In the two years following its investment, Catalyst focused on improving the business model of the firm which today is called Goodlife Pharmacy.

This is Leapfrog’s second investment in Kenya, having injected in 2014 $18.7 million in Resolution Insurance. The firm is positioning itself in a key East African market which is that of pharmaceutical products.

According to a report released on November 4 by the CNUCED, this market is worth $5 billion and has a growth potential of 12% per year. The same report states that it needs substantial investments to fully grow.

Idriss Linge